Fortune Brands Reports Strong Third QuarterOctober 28th, 2021 by Editor
Fortune Brands Home & Security Inc., a home and security products company, recently announced its third quarter 2021 results, which included sales that approached $2.0 billion, an increase of 20% over the third quarter of 2020. Earnings per share (EPS) were $1.45, an increase over the $1.17 from the prior-year quarter. EPS before charges/gains were $1.49, an increase of 25% over the $1.19 it was in the prior-year quarter. Operating income was $286.6 million, compared to $240.2 million in the prior-year quarter, while operating income before charges/gains was $293.3 million, up 20% over the $244.2 million in the prior-year quarter. Operating margin held steady at 14.4%, compared to 14.5% in the third quarter of 2020, and operating margin before charges/gains was 14.8%, even versus the third quarter of 2020.
“Our teams produced very strong results in an extremely challenging environment,” said Nicholas Fink, CEO of Fortune Brands. “Demand remains strong across our portfolio and our investments in innovation, capacity, and digital transformation continue to accelerate the value proposition behind our world-class brands. While supply chain and labor availability headwinds have increased, we are addressing these challenges head-on. We continue to develop and deploy our Fortune Brands Advantage capabilities to further reduce complexity and increase our efficiencies in global sourcing. These actions will help offset these near-term headwinds while also increasing our ability to invest further. The steps we are taking position the Company for continued outperformance and will contribute to achieving our long-term goals in this elongating and expanding housing market.”
As part of the report, the company also provided an update its annual outlook for 2021, now stating that it expects to continue outperforming a fundamentally strong housing market. Fortune Brands now anticipates delivering full-year sales growth in the range of 24.5- to 25.5%, or 17.5-to 18.5% excluding the LARSON acquisition. This reflects its revised assumptions of a global home products market now expanding by approximately 11- to 12%, including growth in the U.S. home products market of approximately 12- to 13%
The Company now expects EPS before charges/gains for the full year to be in the range of $5.63 to $5.73, representing an increase at the midpoint of 36% versus a year ago.
For 2021, the Company expects to generate free cash flow of approximately $625 to $675 million.
“Our business remains well positioned to achieve our long-term goals,” said Patrick Hallinan, CFO. “While the near-term backdrop has become increasingly dynamic, we have the talent and capabilities to overcome these challenges. We continue to see high consumer demand and multiple pathways for earnings growth. Our balance sheet remains strong, and we have the ability to deploy capital to pursue the best returns for our shareholders.”